 Recession, recession, recession, recession. Everybody's talking about a recession. Princeman's recession is gonna come. The other day, I was getting my hair cut, my barber's cutting my hair. He said, hey, Princeman, what are you thinking about this recession? You know, I was getting a shuttle ride down in Louisiana. About a week ago, I was down in Louisiana. The shuttle driver said, hey, Prince, he didn't say my name, but he said, hey, what are you thinking about this recession that's coming up? The shuttle driver, tax cab drivers, Uber drivers, nothing wrong with those professions. Barber, everybody, the recession. Hey, you know, people talking about it like it's bacon cookies, almost. Hey, man, you know, recession when it's coming, Tuesday or Wednesday, what do we have going on, right? Now, I said this months ago, maybe I was ahead, maybe I thought about this a while ago. Months ago, I did a broadcast, and I talked about the recession coming up. Why did I do this? I did this because the recession that's coming up, I told everybody, this is a repeat of 1981 with Paul Volcker was the Federal Reserve Chair, right? And once, so now with Paul Volcker would have been the Fed Chair. With Paul Volcker being the Fed Chair, we had interest rates go up all the way up to 20% if I'm not mistaken. That means that mortgages, people was buying mortgages and they had very good credit. It was getting at 16, 17%. We had inflation so bad, gas prices so bad, we had stack inflation, we had unemployment and inflation at the same time creating stack inflation and the Federal Reserve started to raise interest rates so high that it pushed us into a recession. When we went into this recession, it drenched out all that inflation. Everything was fine again. So when I came back today, the only thing that only indicated was that it was going to be the Fed's office employment. Unemployment is still relatively low. The job market is still relatively tight. It's very hard to find people that want to work. I mean, not that want to work. It's very competitive right now in the job market. If you are an employer, if you're looking for people to hire, it's a very competitive market. The employee has the ball right now. Well, we know it will change. Now, when this particular thing happens, I said, man, months ago, I was like, you know what? They're going to raise interest rates. Interest rates are going to lead to recession. That's how we're going to get out of this mess. This is what they did in the late 70s, early 80s. Oh, this is like deja vu. And my mentor, Uncle James, told me the same thing. When he kind of pushed it, he was here in the 70s. I wasn't here in the 70s. I wasn't here in the early 80s. I was born in the mid-80s. So being born in the mid-80s, I didn't get my parents about myself too. I was in my 90s, but who cares? Anyway, long story short, when I looked at this, I said, this is the only way we're going to get rid of inflation. So I said, well, is a recession necessary to get rid of inflation? I made an episode on that, talking about that. That was my synopsis of looking back to when was the last time inflation had been this high and what did he do to get rid of it? It pretty much was a self-induced inflation. It's like I'm not a medical person. I'm not a doctor by any stretch of the imagination. And stretch of the imagination. But it's like when you see people who get into certain injuries and they put them in a coma in order to have surgery on them to make them better, right? Or when you see people that get frostbite, a frostbite or whatever, they cut off the finger in order to save the hand. When the hand catches gangrene, they cut off the finger to save the hand because if they keep that finger, then guess what? It's going to get so much worse and it'll kill the whole hand. So guess what? They have to suffer with cutting their own finger off of losing the finger in order to save the whole hand. Yesterday, this was reiterated by Jay Powell, Jerome Powell. He said at the Fed chair, things are going to get worse before they get better. Now, Prince, you're talking about the most predicted recession ever. This is what got me nervous, y'all. I'm very nervous about this. I'm very nervous because everywhere I go, everybody know a recession. It's coming, everybody know economical downturn. It's coming, it's like the clockwork. Prince, why are you scared of this? I said in the history, as y'all know, that my latest read right now that I'm working on right now is the trillion dollar triage, right? And I studied market crashes, market cycles, things that have happened in the market. I even done my research and talked to people who were there, talked to people who was there on the stock exchange floor when 87 happened. When 2000.com bomb happened, the real estate crisis of 08, 2020 pandemic. All these catastrophic things that have happened. It's not two hundred people that's living right now that was here for the Great Depression. Unless you, I mean, heck, people warren Buffett wasn't here at that time. But I studied these market histories and these economical downturns and these crashes. Here's the thing that I learned about all of them and the thing I learned the most. They're always unpredictable. Meaning that every time you look at every recession, everything that happens, it happens out of the blue. The black swan, it just comes out of nowhere. Number one, it always happens at market highs. Pandemic, market was at an all time high in 2020, March of 2020, 2008, when we hit the real estate crisis, market was at an all time high.com bomb, market was at an all time high, 87. Markets were at an all times high, ladies and gentlemen. When markets are at an all time high, this is when we have the unpredictable crash recession just kind of comes out of nowhere. Nobody sees it coming, just like we remember two years ago, the pandemic. Who would have thought an airborne illness would come through and just wreck the economy in 2020? How'd they saw it coming? The real estate market crash. It was at an all time high when these things happened. Ask yourself today, are we at an all time high? No, we're not. S&P 500 so far this year is about down 20, almost 30%. Last time I looked at it, 21 or 22%. So we look at it, we're not at an all time high. Also on top of that, it's so predictable that it's scary. Everybody knows about it, everybody knows. Jerome Powell said it yesterday, I wrote in a couple of notes. He said unemployment is going to go up. He turned around and said, we're going to get a little bit more pain before we get better. When he's saying these things, he's talking about economical slowdown or economical delay of what's going to happen to the market. So this was scares me. When everybody in their mama is going right, I start to look left. Why? That's how it has always been in the particular market. When everybody was high off of cryptocurrencies, everybody wanting to get in, everybody rushing to cryptocurrencies, you can see how that transpired as of today. Same thing with stocks. In 2020, when the market crashed, people were like, I'll forget that. Market started to rebound. Everybody said, oh, the market is rebounding. Everybody, let's get into it. Let's get into it. The market is rebounding. The market is rebounding, right? Everybody ran into the market because stock market was going up. A lot of people caught it at the top. Last year, technology companies was a gem for my portfolios. I look like a jeans in 2021. I look like a jeans in 2020. I successfully navigated the bull. I grabbed that bull by the horns and I let my portfolio and my client's portfolio out of a bull market patting myself on the back. Only to turn around in 2022 and to see the return of the bear come running out of the pin again. Last time it came running out in 2020, it had a coronavirus on its nose. This year, you don't see it, right? So this year around, you don't know what it is. Everybody's like, hey, you know what? All that inflation, we pushed trillions of dollars into the economy. We pushed trillions of dollars in the economy in a matter of months, through PPP loan, through stimulus packages. Everybody at bank accounts got stimulated, right? 1,200 bucks a year, 1,200 bucks there, 500 bucks for your kids. Print the money, give it to the people, right? Now, when this happened, everybody loved to get this money, but every cause has an effect. Every action has a reaction. The reaction for pumping trillions of dollars, this trillion dollar triage book that I'm reading, you pump trillions of dollars into the economy that's automatically gonna increase the demand for goods and services. In most cases, people buy more when they make more money, they don't save more. So as people brought more, people had a bigger demand for goods and services. Guess what? At the same time, we had a supply chain issue. When supply is low and demand is high, what happens to prices? Prices increase. Here's a nugget nobody's talking about with the Federal Reserve. The Federal Reserve is slowly to boost the economy. What did they do back in 2020? They lowered the interest rates all the way to zero and pumped money into the stock market. Lower interest rates all the way to zero and pumped about $95 billion a month into the stock market. And you saw the roaring up, oh man, look at the stock market is back. Ooh, it's going to a new highs. Now that we have all this inflation, they're doing the opposite. They are raising the interest rates, pulling money out of the market. Nobody talks about pulling money out of the market. Federal Reserve, $95 billion that they put into the market, they were pumping up the market, AKA they said in a fancy way, we will be adding to our balance sheet. We will be shrinking our balance sheet, adding to our balance sheet, buying more stocks. It's just like somebody comes to my company and say, hey, Prince, I'm going to buy a bunch of your books. I'm not going to pay you, Prince, but I'm going to buy a bunch of your books. I'm not going to print money and just throw it in the air. I'm just going to buy a bunch of stocks, buy a bunch of my books. Of course, this money is going to generate to me, swell up my company, get my evaluations high, all those other good things, right? So now they're doing the opposite. You're sending money being pulled out of the market, you're seeing interest rates being rising up. This will let people believe unemployment is on the way, that things are going to get more painful before they get better, right? Also mortgage rates, real estate market, all the time high, everywhere you go. Two years ago, last year, everybody was like, man, I feel like a jeans. My crypto was up, my house, I brought it for $100,000, $400,000, and now it's worth $500,000. Made a hundred grand off my house, or a million dollars off my house in equity. Got a million dollars in equity. My crypto's are hitting all the time high. You know, everybody said Bitcoin over $1,000 by the end of the year. Everybody's happy. Stocks are up, stocks doing well in 2022, 2021. Stocks are up, your house is up. Cryptocurrency's up, everybody's happy. Now that things are on the downturn, what do people do? That lead me into my first question. What is the best way to prepare for a recession? We're gonna talk about that here. The best way to prepare for a recession? After the break, we're gonna take a break. I mean a very quick break, and we're gonna come back, and we're gonna talk about ways to prepare for a recession that is also predictable this year. Stay tuned. We are back here. Best ways to prepare for a recession. The most predictable recession we've heard of all times. The Federal Reserve got up yesterday and said, hey, unemployment's probably gonna go up, ladies and gentlemen. The dollar is strengthening. Inflation is probably gonna go up. And guess what? My interest rates are gonna go up. So right now with interest rates going up, it's gonna drive the demand for houses, right? You know, I purchased my home two years ago, two, three years ago. Interest rates are at 2%. Now interest rates are at 5% or 6%, right? What would you do to prepare for a particular recession? First question is you gotta ask yourself, are you a short or long-term person? Take me, I'm a long-term person. What is Prince Dyke's doing to prepare for a recession? Number one, I'm riding up oil. I'm riding a train on oil. So I purchase oil and I have shorts put into place, or not shorts, I'm sorry, I'm in stops. Have stops put into place? I'm gonna buy some oil. I'm gonna ride oil for a couple of months. After those couple of months are done, I'm gonna get, you know, probably get rid of oil. I'm not a long-term person on oil because I believe at the midterm election, things are gonna get rough when Congress has started to focus on oil prices and I don't wanna be the person stuck holding oil. So short-term, I'm looking at oil. Long-term, I'm looking at consumer discretionary. Prince, why is this? When we had that big economical downturn in March of 2020, you probably see energy was at the bottom. And March of 2020, energy was like the worst performing sector out of all of these sectors. But guess what now? Two years later, energy is the biggest and best performing sector, and the only performing sector of 2022 essentially out of the 11 sectors that we have. So now I look at it again. I said, hmm, what sector is performing the worst? It's consumer discretionary because of inflation as inflation prices go up with inflation, people buy less, especially things, people don't go out to the movies as much, people don't go out and buy, sit up on Amazon and just buy random stuff, people don't go shopping in high reflationary periods. People try to find ways to stash money. So with consumer discretionary being the lowest and the most beat up sector, I have to start with that sector to look for some gems that are in there. One of them being a household name, Amazon. It's a consumer discretion. They just did a split, was it Monday last week or whatever? What's it, this Monday? I think it was this Monday. They did a split down to $126. Now they're fighting to stay above a hundred bucks. So I don't know when the last time Amazon has been a long time. I can tell you that the Amazon was $100 a share. It split 20 to one shares all the way down from about $2,400 all the way down, right? To a little bit over two grand, I think something like that. Don't quote me on that. But a couple of thousand dollars where Amazon was sitting at before it decided to do a split. Now Amazon has split all the way down to $100. I think it's $102 at the time of this recording. Now you are seeing people, that's what I'm looking. So for the short term, I'm looking at oil. For the long term, I'm looking at Amazon and consumer discretionary. I may pick Amazon or if you're picking your risk level, I may pick the entire sector. I think it's XLY, it's entire sector. Or I may do a leverage bearish, sorry, leverage bullish ETF called WANT, W-A-N-T. Looking into WANT, who's at 20, I don't know, 20 bucks, probably under, pretty sure it's under 20 bucks now. So for about 15 bucks, this is something that when consumer discretionary was at its peak of November last year, this thing was over a hundred bucks. Now that it's all the way down to 15 bucks has been thrown away, has been forgot about. Everybody's talking about inflation and how it's gonna hurt consumers and gas prices and all those other stuff. World is almost coming to an end. Politicians speaking, we got wars going on, all these things like this. Guess what, a year from now, a year and a half from now, we've been gonna forget all this stuff even happened. And I wanna be in a sector or in a position that's doing extremely well that I can get paid back from. So preparing for a recession, if you are a long-term person like myself, for the short term, I'm gonna look for oil and then I'm gonna ride the wave of oil and then I will dump oil and I will probably look into, of course, I'm gonna be buying an index fund but looking at something that I think that can outperform an index and consumer discretionary has gotten beaten up so bad that I think it's gonna have the biggest rebound. Also the NASDAQ out of the top three of the NASDAQ, the tech companies have gotten obliterated. Anytime you see economical downturns happen is always those high-flying companies, those are the ones who get hit the worst every single time. So ladies and gentlemen, that would be my way to prepare. Another way is to, if you are, like it all depends on who you are, right? I would look at it this way, if you are a long, if I was a short-term person and I was getting ready to retire, hopefully you already had your money in bonds and money into cash flowing assets that you didn't have to kind of worry about, this whole equity market crisis or whatever. So it all depends on where you're at in life. If you're just a short-term person, if a short-term person you just never know, but some key rule of thumbs are prepared. Number one, I would start to save money. I wouldn't be as conservative if you have a job because usually once companies start to lay off that nice job that you just got, you'll probably be the first one out the door if things got tight. So look at, I would start to save money and if I was a short-term person, if I had the money to be able to invest through this, I would invest big time and consistently all the way through this. Just imagine, everybody last year was just talking about, man, I was so, the financial illiterate people said, man, I wish I would have brought, I could have had the opportunity to buy. The people who was financially literate was like, man, I'm so glad that this dip happened so I can buy more, I can go in and buy so many things and buy things like that or whatever. Because I mean, right now, when you see the entire market just get slaughtered, all the sectors get slaughtered. You gotta ask yourself why this is happening and what is causing this to happen. Great buying opportunity for investors. This is the time you take your money, the money that you have and look for ways to put it into investments. Real estate, I'm staying away from right now because I feel like real estate is one of the hottest sectors of the market right now. They are hot and you have interest rates. They have building houses like crazy, interest rates are rising and I think we're gonna miss timing where we're gonna end up having too many houses, not enough buyers, and you're gonna see foreclosures throughout the neighborhood and houses that are trying to be sold that are not being sold. That's something that I don't, that's a market that I'm kind of weary of. I would love to have a rental property. I get it, I understand it, but right now the market is just a little too sweet and a little too high for my blood and for my likings. I like to look for things that are on sale, things that are getting beat up. So when you're looking to just keep your money and maintain it, have it grow a little bit, that's when you look for things that are already stable, something like the S&P 500, large companies, like look at Coca-Cola, it's not gonna go out of business, but it's not gonna turn into Tesla either. So that's how I look at pretty much the houses and things like that. Not weary of that. I wanna find that small little company that's getting obliterated, that's gonna shoot to the moon once we start to make our way out of here. And I'm kind of plowing through paperwork. I wanna see it. I wish I was that good to be able to pick them out, but apparently I'm not. So, but that's what I'm looking at, consumer discretionary. I'm looking at the Amazons of the world and I'm gonna look deeper into some companies who's gotten beaten up in the consumer discretionary period that was doing extremely well, but you gotta be careful. You don't wanna be chasing yesterday winners. So I'm gonna see who was doing extremely well financially and who has the potential to grow and make it through all of this mess that we're going through. And cause, you know, you're gonna have brighter days on the other side. So ladies and gentlemen, the most predicted recession I've ever seen. Usually recession kind of starts after something we didn't see. We don't see it. We don't know what's coming, but nowadays we all know it. Everybody's talking. That's what, one thing that makes me weary. It's just like they said, the old story when the guy was getting his shoes shine and the guy that was shining his shoes said, hey, start giving him stock advice. When a person, when the guy was getting a cab to work on Wall Street and the person that was giving him the cab was giving him, well, giving him the cab ride. So to give him stock advice, he knew he needed to go in and sell everything that he had. Pretty funny. That's the one thing that makes me weary. Everybody has predicted this recession and since that everybody has predicted this recession, everybody is going in saying, hey, well, this recession is gonna happen today. It's gonna happen tomorrow. It's gonna be like this. That's what makes me very weary. I said it months ago that I felt like a recession was necessary in order to get rid of this inflation because that's what they did in the early 80s. But now that I hear so many people on this recession bandwagon, hey, y'all, that recession is coming. They're talking like it's a cab that's coming to pick somebody up that everybody knows about this recession. And that's the one thing that makes me nervous because whenever has the masses been right when it came down to Mr. Market, he had his own mind, his own way of doing things and his own way of looking at things. So that's my synopsis on the market being so predictable that I am weary of it. And also how would I prepare to get into a recession? How would I prepare as an investor? As an investor, what would I do? How would I look at things to start to prepare for a recession where I wanna go? If you're an investor, if you just started investing earlier this year and last month, this is where you get your bones. This is how you earn your bones. Because if you haven't been through a market drawback, how can you really be an investor? You got to go through a market drawback. So this is like a qualification card that you're getting to see if you can survive through a market correction in a downturn and still come out victorious. So I'm proud to say back in the pandemic I was there, oh wait, I was around and I was there but I wasn't as heavy as I am today. So yes, I looked to create memories and to do things like that. Well, hopefully you guys and girls got to know this episode, the most predictable recession ever that we've never seen happen. Usually, I don't wanna continue to be the dead horse but hopefully you guys and girls got something out of this. Also, y'all already know my name. My name is Prince Dykes. You can find me on YouTube. You can find me on Instagram. You can find me on Facebook. Think Tech Hawaii. You can go ahead and subscribe to them. Follow me here on Think Tech Hawaii. I have a bi-weekly show, The Prince of Investment. Shout out to Jay Fadale for that name and shout out to Mike the producer that made this show happen tonight. So ladies and gentlemen, and to the next video, podcast, cartoon or whatever else crazy you see me do around the globe, y'all already know my name is Prince Dykes. I'm The Prince of Investment and to the next video, podcast or cartoon, peace, be safe, I'm out and thank you. Thank you so much for watching Think Tech Hawaii. If you like what we do, please like us and click the subscribe button on YouTube and the follow button on Vimeo. You can also follow us on Facebook, Instagram, Twitter and LinkedIn and donate to us at thinktechhawaii.com. Mahalo.